16/07/2026
India Approves Rs 1.9 Lakh Crore Semiconductor and Mobile Manufacturing Push, Opening a Major New Investment Corridor for UK Technology Firms
16 July 2026
The Indian Union Cabinet has approved two landmark schemes that will reshape the country's electronics manufacturing landscape and create significant new opportunities for UK businesses operating in the India corridor. Mint and Inc42 report the government has sanctioned Rs 1.27 lakh crore for Semiconductor Mission 2.0 and a separate Rs 62,500 crore Mobile Phone Manufacturing Scheme, together representing nearly Rs 1.9 lakh crore in committed industrial policy spending.
This is not incremental policy. This is India making its largest ever bet on semiconductor self-sufficiency and electronics manufacturing at a moment when global supply chains are fracturing along geopolitical lines. Union IT Minister Ashwini Vaishnaw confirmed the semiconductor scheme will now incentivise suppliers of raw materials in chip manufacturing, expanding the programme well beyond the fab-level subsidies of the first phase.
Why does this matter for UK businesses? Britain has genuine strength in chip design, compound semiconductors, photonics and advanced materials. Companies in the South Wales semiconductor cluster, the Scottish photonics ecosystem and Cambridge-based design houses now have a substantially larger incentive pool to tap when structuring partnerships or joint ventures with Indian counterparts. The raw materials incentive layer is particularly relevant for UK specialty chemicals and materials firms that have previously found India's electronics supply chain difficult to enter.
The mobile manufacturing scheme creates a parallel opportunity. With Dixon Technologies shares surging 7 percent on the announcement according to the Economic Times, Indian contract manufacturers are scaling rapidly and will need technology partners, quality systems expertise and component supply arrangements that UK precision engineering firms can provide.
For Indian businesses looking at the UK, this strengthens the case for establishing design centres and IP development operations in Britain, where semiconductor talent remains concentrated, while manufacturing scales at home.
The timing is significant. With the India-UK CETA now operational, tariff barriers on components and capital goods moving between the two countries have been substantially reduced. Firms that combine CETA preferences with Semicon 2.0 incentives can build genuinely integrated cross-border supply chains.
